A Product Service Supply Chain Network Equilibrium Model considering Capacity Constraints

Yongtao Peng,Dan Xu,Kun Wang,Yaya Li,Sri Sridharan

doi:10.1155/2020/1295072

Abstract

With the further development of manufacturing servitization, the supply chain established by enterprises has gradually evolved into a product service supply chain. The introduction of service flow has made supply chain management more complicated. In this paper, we build a product service supply chain network composed of raw material suppliers, service providers, manufacturing integrators, and customers. The equilibrium model for decision-makers at all levels is established by variational inequality. In particular, we emphasize the impact of product and service capacity constraints and changes in the product service integration ratio on network equilibrium. The results show that, while capacity constraints on production tend to stabilize and unify the market price, service-related capacity constraints polarize the customer pay price. That is to say, product capability constraints limit the quality of product service systems, while service capability constraints limit the types of product service systems. Furthermore, the introduction of service flow and integration with products creates a more closely networked relationship between the upper and lower layers of the product service supply chain, and an increase in the service proportion will increase the network equilibrium profit.

Highlights

With the rapid development of product technology and changes in customer expectations regarding personalized consumption, competition among manufacturing enterprises has become increasingly fierce, and the integration of products and services has become a new industrial form [1, 2]. e typical characteristics of product service integration are fully demonstrated in the smart phone, shared car, and smart home appliance industries
In Example 1, we demonstrated that capacity constraints will change the equilibrium conditions of the product service supply chain network. erefore, in Example 2, we will analyze the impact of different supplier capacity changes on the supply chain network equilibrium conditions
In the context of manufacturing servitization, more and more service elements are pouring into the traditional product supply chain network, which makes the coordination of the supply chain network more complex. e equilibrium state of a product supply chain fluctuates due to the introduction of service flow, and all participants in the network need to seek a new equilibrium cooperation state in order to provide customers with satisfactory integrated product and service solutions

Summary

Introduction

With the rapid development of product technology and changes in customer expectations regarding personalized consumption, competition among manufacturing enterprises has become increasingly fierce, and the integration of products and services has become a new industrial form [1, 2]. e typical characteristics of product service integration are fully demonstrated in the smart phone, shared car, and smart home appliance industries. The problem of product service supply chain network equilibrium with service flow will be more complex, and the production and service capacity constraints of decision-makers in the network affect the equilibrium state [13, 14]. Us, this paper will study the network equilibrium problem of the product service supply chain considering capacity constraints. (1) How does the constraint of capacity affect the network equilibrium of the product service supply chain?. This study investigates the equilibrium state of service flow introduced into the supply chain network and considers the impact of capacity constraints on its equilibrium state

Model Building

Lagrange Theory and Analysis of the Marginal Utilities

The Algorithm and Numerical Example

Conclusions